AN OFFER YOU SHOULDN’T REFUSE

After nearly four hours of mediation, the gap separating the parties had been reduced to $70,000. Defendant was not willing to make another move, but I sensed plaintiff still had room to negotiate. With the permission of counsel for plaintiff, I offered to present a Mediator’s Proposal for the parties to consider — an offer that counsel for defendant immediately refused, explaining that his adjuster had no interest in having me present a Mediator’s Proposal. Given defendant’s position, the mediation ended for the day.

Perplexed, I followed up with counsel for defendant a few days later, asking him to please remind the adjuster that there could never be any downside in having me present a Mediator’s Proposal. After all, both sides retained the absolute right to reject any proposal I might decide to make. Moreover, I pointed out, even the rejection of a Mediator’s Proposal transmits invaluable information — if not to the other side, then to the mediator.

To demonstrate my point, I asked counsel for defendant to consider what would happen if plaintiff accepted my proposal but it was rejected by defendant. Without prejudicing defendant in any way, plaintiff would discover that defendant had either presented its best and final offer at mediation or that its best and final offer would still be less than the amount I had proposed.

Of course, the opposite was also true — if defendant accepted my proposal, and plaintiff did not, defendant would learn that plaintiff had either presented its best and final demand at mediation or that its best and final demand would still be greater than the amount I had proposed.

Even if my “settlement radar” was so misguided that BOTH sides decided to reject my proposal, that would simply confirm there was no number that would have resolved the matter — a valuable piece of information for any mediator to learn.

One week later, following a further exchange of emails, counsel for defendant informed me the carrier had reconsidered and that I was welcome to present a Mediator’s Proposal. The next day, my proposal was accepted by both sides.

I don’t mean to suggest that every Mediator’s Proposal results in a settlement — far from it! Indeed, I have presented three Mediator’s Proposals, subsequent to the one described above, which were rejected by one side or the other. But each rejection provided valuable information, enabling the parties to make more informed decisions going forward.

I continue to believe that Mediator’s Proposals should be used sparingly, and only as a last resort. However, I also believe an offer to present a Mediator’s Proposal is an offer you shouldn’t refuse. While you can always say “no” to a Mediator’s Proposal that you don’t like, you can never say “yes” to a Mediator’s Proposal that you refuse to entertain.

It would be my pleasure to assist you and your clients in the dispute resolution process. Please don’t hesitate to contact me if I can be of service.

Best regards . . .

Floyd J. Siegal

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